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Thousands of disabled veterans may be eligible for refunds because of tax glitch

Thousands of disabled veterans in the Tampa Bay area may be entitled to a huge tax refund from Uncle Sam, all because of a computer glitch dating back more than two decades.

Thousands of disabled veterans in the Tampa Bay area may be entitled to a huge tax refund from Uncle Sam, all because of a computer glitch dating back more than two decades.

“I think it is a super big deal to disabled vets,” said Dave Cain, a disabled Air Force Veteran who recently moved to Pinellas County.

For Cain and thousands of other disabled veterans, the news was overwhelming.

“I don’t know what will come to me,” said Cain, “But any money would be a benefit.”

This month, the Deptartment of Defense started sending out letters to an estimated 130,000 disabled vets whose benefits had been improperly taxed, letting them know they might be owed a refund of thousands of dollars.

A computer error that went undetected between 1991 and 2016 led the IRS to tax the veterans’ benefits -- which were supposed to be tax exempt.

“Well, if it’s a benefit to me that’s fine. But I’m hoping that other people get it as well,” said Cain.

The National Veterans Legal Services Program, which recently spotted the error, says the Tampa Bay Area is likely to be impacted.

“I would say that it does definitely include the Tampa Bay and St. Petersburg area,” said David Sonenshine, senior staff attorney with the National Veterans Legal Services Program, “due to the number of veterans you have in that area and also the active-duty service members in that area as well.”

Tampa accountant Heather Kovalsky with the accounting firm Brimmer Burek and Keelan says it might be hard for some people to come up with records dating back 27 years. But she says there are alternatives minimum refunds, so that those eligible can still receive something.

“For example, if you received the benefit in 1991 and you don’t have your tax records to go back and actually do a full amended return, you would get a refund of up to $1,750. Each year,” said Kovalsky.

Knowing how many disabled vets struggle financially, “I think it could be life-changing for them. Or at least a good start,” said Cain.

If a disabled veteran has since passed away, their surviving spouse or the trustee of the estate can still apply for the same tax refund.

The Department of Defense is sending out letters to those eligible for the refunds. They should arrive Iin the next three to four weeks.

If a disabled veteran does not get a form from the Department of Defense but still thinks they should be eligible for a refund, contact the National Veterans Legal Services Program at http://www.nvlsp.org/

You can reach the NVLSP by email at info@NVLSP.org.

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